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The Future Combat System (FCS) program is the centerpiece of the Army's effort to transition to a lighter, more agile, and more capable combat force. By law, GAO is to report annually on the FCS program. Also, law requires the Department of Defense (DOD) to hold a milestone review of the FCS program, now planned for 2009. This report addresses (1) what knowledge will likely be available in key areas for the review, and (2) the challenges that lie ahead following the review. To meet these objectives, GAO reviewed key documents, performed analysis, attended demonstrations and design reviews, and interviewed DOD officials.

The Army will be challenged to demonstrate the knowledge needed to warrant an unqualified commitment to the FCS program at the 2009 milestone review. While the Army has made progress, knowledge deficiencies remain in key areas. Specifically, all critical technologies are not currently at a minimum acceptable level of maturity. Neither has it been demonstrated that emerging FCS system designs can meet specific requirements or mitigate associated technical risks. Actual demonstrations of FCS hardware and software--versus modeling and simulation results--have been limited, with only small scale warfighting concepts and limited prototypes demonstrated. Network performance is also largely unproven. These deficiencies do not necessarily represent problems that could have been avoided; rather, they reflect the actual immaturity of the program. Finally, there is an existing tension between program costs and available funds that seems only likely to worsen, as FCS costs are likely to increase at the same time as competition for funds intensifies between near- and far-term needs in DOD and between DOD and other federal agencies. DOD could have at least three programmatic directions to consider for shaping investments in future capabilities, each of which presents challenges. First, the current FCS acquisition strategy is unlikely to be executed within the current $159 billion cost estimate and calls for significant production commitments before designs are demonstrated. To date, FCS has spent about 60 percent of its development funds, even though the most expensive activities remain to be done before the production decision. In February 2010, Congress will be asked to begin advancing procurement funds for FCS core systems before most prototype deliveries, critical design review, and key system tests have taken place. By the 2013 production decision, Congress will have been asked for over $50 billion in funding for FCS. Second, the program to spin out early FCS capabilities to current forces operates on an aggressive schedule centered on a 2009 demonstration that will employ some surrogate systems and preliminary designs instead of fully developed items, with little time for evaluation of results. Third, the Army is currently considering an incremental FCS strategy--this is to develop and field capabilities in stages versus in one step. Such an approach is generally preferable, but would present decision makers with a third major change in FCS strategy to consider anew. While details are yet unavailable, it is important that each increment be justified by itself and not be dependent on future increments.

Matters for Congressional Consideration

Status: Closed - Not Implemented

Comments: In light of the decision to terminate the manned ground vehicle portion and restructure the remainder of the Future Combat System program, this recommendation is no longer applicable.

Matter: The Congress may wish to consider not approving any production or long lead item funds for the core FCS program until the critical design review is satisfactorily completed and demonstrations using prototypes provide confidence that the FCS system-of-systems operating with the communications network will be able to meet its requirements.

Status: Closed - Not Implemented

Comments: The Congress did not restrict the budget authority for FCS as we recommended.

Matter: The Congress may wish to consider restricting the budget authority to be provided for FCS in fiscal year 2010 until DOD fully complies with the statutory FCS milestone review requirements and provides a complete budget justification package for any program that emerges.

Recommendations for Executive Action

Status: Closed - Implemented

Comments: In response to this recommendation, DOD agreed. Several remnants of the FCS program--all considered to be in production representative form--were involved in a limited user test in September 2009. The Defense Acquisition Board subsequently approved, with some restrictions, low rate initial production of several of these FCS spinout items in December 2009.

Recommendation: The Secretary of Defense should ensure that FCS systems to be spun out to current forces have been successfully tested in production-representative form before they are approved for initial production.

Agency Affected: Department of Defense

Status: Closed - Not Implemented

Comments: The congressionally mandated milestone review for FCS did not occur as expected. Instead, in 2009, DOD decided to terminate major portions of the FCS program and to execute the remaining portions in drastically different ways. Hence, this recommendation is no longer applicable.

Recommendation: The Secretary of Defense should ensure that if an incremental approach is selected for FCS, the first increments are justifiable on their own as worthwhile capabilities that are not dependent on future increments for their value, particularly regarding the order in which the information network and individual manned ground vehicles will be developed.

Agency Affected: Department of Defense

Status: Closed - Not Implemented

Comments: The congressionally mandated milestone review for FCS did not occur as expected. Instead, in 2009, DOD decided to terminate major portions of the FCS program and to execute the remaining portions in drastically different ways. Hence, this recommendation is no longer applicable.

Recommendation: The Secretary of Defense should direct the Secretary of the Army to convene, following the preliminary design reviews and in time to inform the 2009 FCS milestone review, an FCS Configuration Steering Board to provide assistance in formulating acceptable trade-offs to bridge the gaps between the FCS requirements and the system designs.

Agency Affected: Department of Defense

Status: Closed - Not Implemented

Comments: The congressionally mandated milestone review for FCS did not occur as expected. Instead, in 2009, DOD decided to terminate major portions of the FCS program and to execute the remaining portions in drastically different ways. Hence, this recommendation is no longer applicable.

Recommendation: The Secretary of Defense should ensure that the investment program that emerges from the 2009 milestone review be conformed with current DOD acquisition policy, particularly regarding technology maturity, critical design reviews, and demonstrating production-representative prototypes before making production commitments.

Agency Affected: Department of Defense

Status: Closed - Implemented

Comments: In its response to this recommendation, DOD stated that in November 2008, the Under Secretary of Defense for Acquisition, Technology, and Logistics directed the Army to examine contracting alternatives for procurement of FCS capability. Also, in the June 2009 Acquisition Decision Memorandum, the Under Secretary specified that the Army present a plan for the transition away from industry-led integration efforts. Subsequently, the Army has presented and is implementing its plan to move away from industry-led integration over the next few years. For example, in it procurement contracting plans for the E-IBCT equipment, which are remnants of the FCS program, the Army will be contracting directly with the original equipment manufacturers for the fourth production lot.

Recommendation: The Secretary of Defense should reassess the appropriate role of the LSI in the FCS program, particularly regarding its involvement in production.